UPDATE: Critical economic data is set to shape market expectations this week, from January 5-9, as several key reports emerge. The focus will be on the ISM Manufacturing PMI, ADP Nonfarm Employment Change, and various inflation metrics that could influence central bank policies.
Monday kicks off with a quiet start for the FX market, but attention quickly turns to the U.S. ISM Manufacturing PMI report, expected to provide insights into manufacturing health. Tuesday will see the release of services PMI data across the Eurozone, U.K., and U.S., crucial for assessing service sector dynamics.
On Wednesday, inflation data from Australia and the Eurozone is anticipated, with the Australian CPI forecast to rise by 0.1% month-on-month and an annual rate of 3.7%. Analysts at Westpac highlight that a sharp 16% increase in electricity prices is a significant factor behind these projections.
Thursday will bring Switzerland’s CPI data, with a consensus of 0.0% month-on-month compared to -0.2% previously. Officials from the Swiss National Bank (SNB) expect inflation to stabilize within the 0-2% target range.
Friday is packed with pivotal labor market reports. Canada will release employment change figures and the unemployment rate, while the U.S. will unveil average hourly earnings, nonfarm payrolls, and the unemployment rate. The U.S. unemployment rate is projected to decrease from 4.6% to 4.5%, despite recent mixed job growth.
Recent data indicates a significant slowdown in U.S. hiring, particularly in the private sector, raising concerns about the labor market’s resilience. Wells Fargo analysts predict subdued hiring levels compared to historical trends, while wage growth remains soft, potentially easing inflationary pressures driven by labor costs.
The upcoming week’s data is critical for the Bank of Canada’s policy decisions in January. Following a substantial drop in the unemployment rate in November, a modest decline in employment is expected, highlighting the volatile nature of the labor market.
As these reports are released, market participants will closely monitor the implications for monetary policy. With the Fed’s focus on maintaining stable employment and inflation rates, the results from these upcoming reports will be pivotal in shaping expectations for interest rate adjustments.
Stay tuned for real-time updates as these significant economic metrics unfold, influencing not only market trends but also the broader economic landscape. Share this urgent update to keep your network informed!
